By 
The Zambian kwacha extended its losing streak to seven consecutive trading sessions on Wednesday as continued demand for United States dollars outweighed available foreign currency supply.
According to Bloomberg data, the Kwacha weakened by 0.41% to close just below K20 per dollar, reflecting persistent hard currency demand from businesses and other market participants.
Analysts, however, expect some relief for the local currency in the coming sessions, with provisional tax payments due by Oct. 10 potentially increasing dollar liquidity in the market.
The Kwacha’s continued weakness comes amid broader strength in the US dollar, which remained near a three-month high as investors assessed expectations for another Federal Reserve interest rate hike before the end of the year, elevated US Treasury yields and renewed geopolitical risks.
Read more: Zambian Kwacha extends gains for fourth session on month-end dollar supply
The Bloomberg Dollar Spot Index remained close to its highest level of the year, although further gains could depend on fresh market catalysts as the US economic data calendar remains relatively light.
Recent Federal Reserve meeting minutes reinforced expectations that policymakers remain cautious about inflation.
However, comments from senior officials, including Vice Chair Philip Jefferson and New York Fed President John Williams, have reduced expectations of an immediate rate move in October.
Market attention is now turning to the upcoming US consumer price index report, which is expected to provide further guidance on the Federal Reserve’s monetary policy direction.
WARNING! All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express permission from ZAMBIA MONITOR.
Comments